HMRC has announced that it will not proceed with plans for a digital interim claims service for the relief at source system, after work on this proved “more complex than originally thought”.

HMRC had previously outlined plans for a staged approach to the digitisation of relief at source, initially aiming to provide functionality to make interim claims digitally by the end of the tax year 2022 to 2023.

However, in its latest Pension Schemes Newsletter, HMRC stated: “Our overriding priority is to deliver a full digital service, including individual level data, for digitisation of relief at source claims by April 2025.

“We had intended that the digital interim claims service would be the first step towards this.

“However, having reviewed the work necessary for both the interim claims service and the full service, we’ve reluctantly decided not to proceed with a digital interim claims service.”

The newsletter confirmed that HMRC is now instead focussing its deliver efforts on ensuring it is able to deliver the new digital relief at source service by April 2025.

The new system aims to modernise reporting for schemes and deliver improvements for members, employers and HMRC, with all claims to be based on individual level data to allow HMRC to accurately calculate the tax relief due.

“We’re working closely with a group of stakeholders from the pensions industry to help us understand the challenges and benefits,” it stated.

“We’ll continue to work with those in the industry to co-design the new service, test the new processes throughout the development phase and seek feedback to iterate our design.”

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